IIT Madras

January 2006 1

Empowering Rural India : Challenges and Opportunities

Ashok Jhunjhunwala, IITM, Chennai

ashok@tenet.res.in

IIT Madras

January 2006 2

Rural India has700 million people

in 600,000+ villages (about 1000 people per village with per-capita income of Rs 20 per day)

– per capita GDP of Rs 10000 per year

Can technologies make a significant difference in life of such people?

– Can it bring to them health & Education

– Can it significantly enhance their incomes?

102.1

1710

3.9 1.9 1 0.3 0.30

20

40

60

80

100

120

3 9 13 18 26 42 65 112

HH Income in thousand Rs/month

Nu

mb

er o

f H

H in

mill

ion

s

135 million rural households

IIT Madras

January 2006 3

To make an impact in Rural India,it must Scale

can an effort scale to all the villages in India?

To Scale – Technology– Sustainable Business Model– Organisation which thinks and acts Rural

IIT Madras

January 2006 4

Backbone Connectivity

– BSNL has Fibre to every taluq hq But Expensive: Rs 2 lakhs for 64 kbps link and Internet BW

– Fortunately Tata, Relaince, Bharati, Railtel, others also have some fibre links

Access Center (serving 300 villages) need 512 kbps/ 2 Mbps connectivity

– Lease 2 Mbps to make a Rural backbone network (Intranet)– National / International bulk BW at City

Optimise cost: use NIXI Rural (video Conf) BW on intra-net Cache servers

300 villages

Internet

AC

ACAC

IIT Madras

January 2006 5

Broadband CorDECT WiLL developed at IITM, India provides a telephone line and 128/256 kbps Internet connection in

25 Km radius Exchange and tower in town

– Works at 55 C– Power requirement: 1 KW– start-up costs very low

Newer technologies emerging– Promising 1/2 Mbps connectivity

with OFDM (like 802.16 / WiMax) with HDR and HSDPA

Innovative Technology to connect Rural India

Rs 10000 per line deployed Exchange and tower in town Works at 55 C Power requirement: 1 KW

IIT Madras

January 2006 6

Business Model:Use Local Entrepreneurs to drive ICT

Entrepreneur-driven operator assisted telephone booths (STD PCOs) introduced in India in 1987

– Today in urban areas: 950,000 such PCOs covering every street of smallest town generate 25 % of total telecom income 300 million people use these PCOs

Lesson for Rural: – To serve Rural people with incomes

less than $ 1/day, aggregate demandand let Entrepreneurs drive it

Aid/ Grant does not scaleSuccessful Enterprises can scale to all villages

IIT Madras

January 2006 7

n-Logue : A Rural Service Provider– aggregate demand into a kiosk– owned & driven by a local entrepreneur

– Rs 55000 (including taxes) per Kiosk providing telephone, Internet, multimedia PC with web-camera, printer and power back-up for PC

plus Indian language software, video conferencing software, training and maintenance and 6 months unlimited Internet

– set up by a village entrepreneur on the lines of urban PCOs provides telephone, stand-alone Computer and Internet services needs Rs 4000 pm to break even

Innovative Business Models

IIT Madras

January 2006 8

Provides Training and Technical Support Handles Licensing and Policy issues Provides Internet Backbone Connectivity Enables Kiosk Services through Alliance Partners Creates Awareness

Application & Solution Providers

Internet Backbone

ACCESS CENTRE

Local Service Partner

Markets Connections Provides Onsite Support and Training Manages Local Web & Email Services Manages Local Content Pages

Scope:3000 sq km400-600 connections (1 in each village)

Internet Kiosk Operator

School/PHC Private Business Government Office Rural NGO

Provides Internet Access to Local Community Provides Awareness and Training Channels Information needs of Community through

LSP to Application & Content Providers

Financing

IIT Madras

January 2006 9

The Kiosk Owner Should have studied up

to Class 10 Need have no prior

computer Training Should be able to

communicate to the people in the village

Top: Suganya from Madurai Dist,TNLeft : Anishaben from Banaskanatha Dist,Guj

IIT Madras

January 2006 10

Kiosk: Bouquet of Services (besides telephony)

– Learning typing– Computer education– Photography– movies on CD– DTP work– Email/voice & video mail– E-Government– Video conferencing providing

Tele-medicine Vet Care E-learning E-Agriculture

IIT Madras

January 2006 11

Infrastructure Capacity Building End to End Services using ICT

– Basic Services (email, browsing, games, DTP, astrology, matrimonial, photography) – Communication Services (VoIP, Mobile)– Education– Micro-franchise– ITeS– Telemedicine– Agriculture– Financial Services – Jobs– Buying and Selling– E-governance– Micro-enterprise– Online Games

4

Where are we?

Rating in0 to 5 scalebased on understanding

IIT Madras

January 2006 12

4

3+

3+

Infrastructure Rural backbone

– India has fibre to most taluka headquarters Lease BW on these fibre to make a Rural Backbone VPN Add capacity as and when needed Intra-rural communication remains on VPN VPN connected to Internet at one or two points

Broadband Accees– 100 kbps plus Connectivity

For 400 villages in 30 km radius – 70% of India if villages over 500 considered

At Rs 10K per connection including towers

PC + SW + Power (battery back-up or genset) + Accessories

IIT Madras

January 2006 13

Capacity Building

Selection of Operator Training of operator

– On-going training– Identifying weak operators and retraining

Marketing and Driving Services2+

IIT Madras

January 2006 14

Education 3+

Using multi-party video-conferencing tool by OOPS

IIT Madras

January 2006 15

N-Logue’ Education portfolio

Basic computer course– BLUE (6-9yrs): 6 hrs, BLUE PLUS (6-9 yrs), certified: 26 hrs, GREEN (10-17yrs), certified: 20 hrs,

RED (17+yrs), certified: 72 hrs Web based 9th and 10th Std Online Test and Tutorial (TN)

– Focused on passing exams Web based Spoken English on video (TN) New

– Chiraag English Programme & Children’s club– Computer Graphics Tutorial

Potential for Vocational Courses– Audio/video editing, Graphics and animation, Web development, CAD/CAM

Kiosk Operators estimate that in a village of 1500, one can earn a minimum of $90 per month with these services

Is their a scope for a Rural Education company?

IIT Madras

January 2006 16

Distributed Production In Rural India: Crafts & Micro-franchise

Current Status: 7 villages, 5 to 10 women ineach village

1+

IIT Madras

January 2006 17

Distributed Production enabled by Internet

Embroidery for Life– Women embroiderers trained by

designer entrepreneur in villages– An emerging business model for

entrepreneur and kiosk operator

Bags for Life– Training in handmade paper bag,

organizing production, quality control – Quality products for the domestic and

export market

IIT Madras

January 2006 18

IT enabled ServicesCurrent Status: 35 villages 2+

IIT Madras

January 2006 19

Job work performed at the kiosk

Click here if there is problem in viewing this slide

IIT Madras

January 2006 20

Rural ITeS Map – skills vs jobs available

Level of Skill Data Voice Visual

Unskilled [May only know how to converse in a regional language]

Downloading images Image identification

Semi skilled [May only know how to read and write in English in addition to a regional language]

Typing Data Entry

Providing Voice for flash CDs

Skilled [Must have some basic technical capability]

Translation Desktop Publishing

Audio editing Web development Multimedia using Flash

IIT Madras

January 2006 21

TelemedicineStarted with video based eye care, contacting doctor

and Vet doctor

Vet care with Veterinary college

2+

Remote Eye Care with Aravind Hospitals

IIT Madras

January 2006 22

ReMeDi™ Tele-medicine solution

IIT Madras

January 2006 23

Financial Services Can kiosks be mini-banks?

– Can they facilitate agricultural loans?

– Can money transfer from cities/ urban areas be facilitated?

Can kiosks facilitate micro-finance?

– Can the interest rate be significantly brought down?

Can kiosks carry out credit-rating of rural people?

What about Insurance?Vortex GramaTeller initiative with ICICI, reducing the cost of ATM to

1/15th

2-

IIT Madras

January 2006 24

IIT Madras

January 2006 25

Agriculture2- leaving out ITC e-choaupal

AfterBefore

FARMER

INPUT facilitation

Seeds, Fertilisers, Pesticides, Farm Machinery, Soil Testing

CREDIT facilitation

HARVEST & TRANSPORT OF PRODUCE facilitation

IRRIGATION facilitation

PRODUCTION RISK COVERAGE & PRICE RISK COVERAGE

STORAGE facilitation

NEEDS OF THE FARMER

KNOWLEDGE / Extension Services Facilitation/ Alternate farming

MARKET INFO & Linkage facilitation

IIT Madras

January 2006 27

Successful end to end services

ITC e-choupal excels in providing services to farmers– Sunflower and soybean crops

EID Parry has used the kiosks for supporting sugarcane farmers

IIT Madras

January 2006 28

N-Logue’s Agri-efforts

Knowledge/Extension Facilitation Expert Consultation over Videomail (MV4 recorder) Expert Consultation over Videoconferencing

Input Facilitation– with SPIC for online ordering: Tissue Culture Banana– with Rural Innovation Network for online ordering

Irrigation Facilitation– with International Development Enterprise (IDE)

Online ordering: Small Farming Solutions like Low Cost Drip Irrigation

with Godrej Agrovet Seeds, Fertilisers, Pesticides, Farm Machinery, Technical Advice & Soil

TestingAcqua (from IIT Mumbai): expert answering questions

IIT Madras

January 2006 29

Micro-weather prediction

Collect weather data at each village Temperature, humidity, pressure, wind speed, wind direction and rainfall Can one use micro-weather prediction systems? Use village data for weather insurance

TeNeT & Neurosynaptic develops– Weather Monitoring Kit : Rs 10,000

Remote Measurement of each of these parameters at each village multiple times a day and recoding at some central server

Prototype ready

Weather Monitoring System

Serial Interface PC

0

1-

1+

0+

0

0

Other Services

– Jobs

– Buying and Selling

– E-governance

– Micro-enterprise

– Online Educational Games Intra-village

– Transportation

IIT Madras

January 2006 31

Infrastructure Capacity Building End to End Services using ICT

– Basic Services (email, browsing, games, DTP, astrology, matrimonial, photography) – Communication Services (VoIP, Mobile)– Education– Micro-franchise– ITeS– Telemedicine– Agriculture– Financial Services– Jobs– Buying and Selling– E-governance– Micro-enterprise– Online Games

4

Services Status

How do we drive each of these to 4+ in the next two years?

How many companies does each require?

What about community oriented services?

3+2+

3+1+2+2+2-2-01-1+0+0

3

IIT Madras

January 2006 32

The DreamCurrent Rural GDP in India = Rs 700,000 Crores

For a Population = 700 million people

GDP / Person = Rs 10,000 per year

DOUBLING per-capita Rural GDP

Rs 20,000 per person per year

Rural Prosperity

IIT Madras

January 2006 33

N-Logue’s reach

Today– 2500 kiosks primarily in three states of India

Extremely difficult to obtain data about kiosk incomes– Kiosk operators do not provide correct data

Sample survey of 150 kiosks by Microsoft-nLogue over the last year

– Over the last year, 62 out of 150 kiosks have added a second PC Correlates well with Internet connection throughput

– Many more have added CD-writers, scanners, additional printer

IIT Madras

January 2006 34

As kiosks want a second computer

Introducing NetPC (Multimedia Network PC)– Connected to a PC Server on LAN

No virus, no back-up required

– Target price: Rs 3500 plus monitor

IIT Madras

January 2006 35

Tomorrow’s kiosk

Tomorrow the kiosk should become– a communication hub: providing 50 telephone and Internet

connection in a village– a center for virtual university / training center

technology support center

– a support center for Entrepreneurship– a banking outlet

micro-finance outlet

– a trading outlet agri-support center

– a medical support center

and more

IIT Madras

January 2006 36

To Sum Up Technologies can impact lives provided there is a big

enough Vision behind it

– Dream of Doubling per capita Rural GDP Finance, Commerce, Training &

Information are key– Driving Education, Health and Entrepreneurship is

the means

Agriculture Support key to Rural Wealth

Power Supply will be key bottleneck– Entrepreneur sets up (20-50KVA) back-up

power plant and distribute in the village– initially with diesel, later with bio-diesel